The Formula for a Hedge Ratio of a Put Is

question 2

True/False

The formula for a hedge ratio of a put is the same as that of the call,except that put prices are used instead of call prices.

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Definitions:

Debt/Asset Ratios

A financial ratio that compares a company's total debt to its total assets, indicating the company's leverage.

Market Capitalization

The total market value of a company's outstanding shares, calculated by multiplying the current stock price by the total number of outstanding shares.

Variance of Earnings

A statistical measure that represents the degree of variation or dispersion of a company's earnings over a specified period.

Standard Deviation

A statistical measure that quantifies the amount of variation or dispersion of a set of data values, often used to measure the volatility of financial returns.